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The UK Has a Better Story to Tell
14 augustus 2026 · 5 min
Our Global Head of Fixed Income Research Andrew Sheets examines why investors might be overlooking the stability and performance of UK assets, despite persistent negative sentiment. Lees meer
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----- Transcript -----
Andrew Sheets: Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Today, why the UK may need better PR.
It's Friday, August 14th at 2pm in London.
The last decade has been rough for the United Kingdom. Brexit was a true economic earthquake, and the subsequent weakening of economic ties to mainland Europe, the UK's largest trading partner, made economic activity weaker and more complicated.
Then COVID hit the economy hard. So did spiking energy prices when Russia invaded Ukraine. Political volatility has been high, with seven prime ministers in the last 10 years. And at present, UK growth is weak, inflation is too high, and debt to GDP is rising.
Moreover, in a post-COVID world that's increasingly driven by the profit and power of technology, including AI, the UK market seems almost stuck in another era. Of the 10 largest companies in the U.S. stock market, eight are in technology. In the UK, none of the 20 largest companies are in tech.
Safe to say, being downbeat on the prospects for the UK is one of the most consensus views that I encounter. But it can also be deceiving. Simple stories in the market rarely are.
Let's start with the argument that UK markets are boring, stagnant, and being left behind by their lack of technology. It's just not true. Through early August, the S&P 500 has returned 85 percent over the prior five years. The UK market? It's returned 82 percent. And over the last twelve months, the performance of the UK and U.S. markets are also similar. In short, don't judge a book by its cover.
The UK's currency, meanwhile, shows no sign of global investors shunning the island. Over the last 10 years, the UK pound has actually gained value aga…
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Robotaxis’ $1 Trillion Opportunity
13 augustus 2026 · 13 min
Robotaxis are accelerating along the road to commercial viability. Auto and Shared Mobility Analysts Andrew Percoco and Tim Hsiao discuss what this rapid development means for global investors. Lees meer
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Andrew Percoco: Welcome to Thoughts on the Market. I’m Andrew Percoco, Head of North America Auto and Shared Mobility Research.
Tim Hsiao: And I'm Tim Hsiao, Greater China Auto and Shared Mobility Analyst.
Andrew Percoco: Today, why robotaxis may be approaching a commercial inflection point. It's Thursday, August 13th at 8am in New York.
Tim Hsiao: And 8 pm in Hong Kong.
Andrew Percoco: So Tim, for years, robotaxis were really confined to limited pilot rollouts across the globe. You've done a lot of work over the last few weeks. We put out a big collaborative report on the robotaxi market and how it could be a $1 trillion TAM by 2040.
What makes this moment different than some of the other robotaxi hype cycles that we've seen in the past?
Tim Hsiao: We observe four things have been converging. Firstly, end-to-end AI is improving much faster. Secondly, hardware and the training costs are falling. And thirdly, more well-capitalized players can fund deployment. And last but not least, regulation is becoming clearer.
The leading operators are no longer just demonstrating the technology. They are running fully driverless services around the clock and generating commercial rides. So in our view, the questions has been shifting from can it work to who can expand operating areas, raise utilization and lower costs at a much faster pace.
So that's a very different setup versus the 2018 and 2021 hype cycles.
Andrew, U.S. autonomous miles could rise from 116 million in [20]25 to 16 billion by 2032. But still make up only about 0.5 percent of all miles driven. How can robotaxis become a meaningful business while remaining such a small part of the market?
Andrew Percoco: I would say, you know, obviously the U.S. m…
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The Potential Way Forward for the U.S.-Iran Standoff
12 augustus 2026 · 4 min
The potential path to a durable U.S.–Iran agreement has twists and obstacles ahead. Our Head of U.S. Public Policy Research Ariana Salvatore discusses current negotiations and the impact of recent developments for investors. Lees meer
Disclaimer: Important note regarding economic sanctions. This report references jurisdictions which may be the subject of economic sanctions. Readers are solely responsible for ensuring that their investment activities are carried out in compliance with applicable laws.
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Head of US Public Policy Research at Morgan Stanley. Today, the latest on U.S.-Iran tensions, talks, and the path to a deal.
It's Wednesday Aug 12th, at 2 p.m. in New York.
The diplomatic picture in the Middle East has shifted yet again.
Last week, there was growing optimism that the U.S., Iran and Oman could reach an arrangement to improve commercial passage through the Strait of Hormuz. But the two sides have since hardened their positions. This week, we've seen some bouts of escalation, and headlines have been mixed over the past few days.
At the same time, the energy security picture remains complicated. The U.S. administration says the seven-day average of oil leaving Hormuz has risen to almost 9 million barrels per day. But traffic remains well below normal conditions, and the risks we think are no longer limited to the Strait. We’re beginning to see potential for disruption across multiple regional chokepoints and alternate shipping routes.
That brings us back to the framework negotiated nearly two months ago. The U.S. and Iran signed a Memorandum of Understanding in mid-June. It was intended to create a 60-day window for negotiating a more durable agreement. That framework addressed commercial passage through Hormuz, the U.S. naval blockade, sanctions relief and frozen funds – as well as longer-term negotiations over Iran's nu…
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‘Show Me the Money,’ Market Tells Companies
11 augustus 2026 · 5 min
Our CIO and Chief U.S. Equity Strategist Mike Wilson discusses a new market cycle, in which investors are demanding more than just growth from companies. Lees meer
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----- Transcript -----
Mike Wilson: Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today on the podcast I’ll look at an important shift in what the market wants to see from companies going forward.
It's Tuesday, August 11th at 11:30 am in New York.
So, let’s get after it.
This week I am going back to our broadening thesis – but with a slightly different twist.
Earlier in the year, broadening was about beta. It was about the market moving beyond a narrow set of mega-cap winners and rewarding economically sensitive areas as the rolling recovery took hold.
In the last few episodes I’ve talked about how that phase is now over. And we’re moving from an early-cycle broadening into a mid-cycle quality rotation. In short, the market is no longer demanding just growth – but growth with durable earnings, strong margins, and free cash flow.
To be clear, the broadening in earnings is still very much alive. Russell 3000 median stock earnings growth is running at 15 percent, the strongest since 2021; while median sales growth is at 8 percent, the best since 2023. At the same time, 87 percent of S&P 500 companies are beating earnings expectations this quarter, and earnings revisions breadth has rebounded to 23 percent, with 76 percent of industry groups showing positive revisions breadth.
However, headline earnings are no longer enough for stock outperformance. The market is saying, ‘Show me the money’— and that’s exactly what should happen in a mid-cycle transition. When companies raise both earnings and free cash flow estimates, they are rewarded. When they only raise earnings and not free cash flow, the market is much less forgiving. Investors are no longer paying indiscriminately for growth. They want cash conversio…
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How AI Could Simplify the Mortgage Market
10 augustus 2026 · 8 min
Our U.S. Consumer Finance Analyst Jeff Adelson and our Co-Head of Securitized Product Research Jay Bacow explain why AI can transform the way Americans shop for, manage and refinance their mortgages. Lees meer
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----- Transcript -----
Jeff Adelson: Welcome to Thoughts on the Market. I'm Jeff Adelson, Morgan Stanley's U.S. Consumer Finance Analyst.
Jay Bacow: And I'm Jay Bacow, Co-Head of Securitized Products Research, also working at Morgan Stanley.
Jeff Adelson: Today, how AI could change the way Americans shop for, manage, and refinance their mortgages.
It's Monday, August 10th at 10am in New York.
The U.S. mortgage market is worth more than $14 trillion, and its performance ultimately depends on the choices millions of homeowners make. Today, refinancing still means shopping around, comparing offers, and working through a lot of paperwork. AI could make that process much easier, especially when rates begin to fall.
Jay, you led this work on our AI mortgage blue paper. What's the main way AI could change the mortgage market, and why does the borrower matter so much?
Jay Bacow: So we think the biggest change would be borrower adoption of using AI agents to manage their personal finance. An agent on your phone could just monitor mortgage rates, compare lenders, reduce the paperwork, and make homeowners more likely to refinance when the economics work.
Let's think about what that could be. Historically, only about 30 percent of borrowers that had the ability to lower their mortgage rate by a 100 basis points did so in a given year. When a borrower went to get a mortgage quote, less than half of them asked more than one lender for a quote.
That agent could go reach out to 30 lenders, ask for a variety of different mortgages, could upload all the documents, could do this all effectively instantaneously, present the homeowner with the best option. Allow the homeowner to effectively click a button and refinance. I think this could …
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AI’s New Rules of Engagement
7 augustus 2026 · 5 min
Our Head of U.S. Public Policy Research Ariana Salvatore explains how U.S.-China tensions, export controls and domestic regulation are reshaping where AI is built, who controls it and what investors should watch. Lees meer
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Head of U.S. Public Policy Research at Morgan Stanley.
Today, a look at how government is increasingly determining the future of AI in the U.S. – from where it's built to which technologies US companies and consumers can use.
It's Friday, August 7th at 10am in New York.
AI is rapidly reshaping the economy and society, so this is a pivotal moment for government to consider the rules governing that development. The first area to watch is technology restrictions, particularly in the context of U.S.-China competition.
Now, for much of the past decade, the government's approach has been to restrict a relatively narrow group of technologies with clear national security implications while maintaining broader commercial ties. But as export controls spread across more sectors of the economy and AI moves from software into physical infrastructure, the definition of what qualifies as national security has become broader.
The Department of Commerce could, for example, expand the entity list. That would require US cloud providers, software companies, and model marketplaces to remove or stop supporting models tied to designated Chinese developers.
Congress could then make those restrictions more durable through things like the annual defense bill or other policy vehicles. We're keeping an eye on several legislative proposals, like the AI Overwatch Act, which would tighten controls and give congressional oversight around exports of the most advanced AI chips; and the MATCH Act, which would extend restrictions further upstream to semiconductor manufacturing equipment and seek closer alignment with allied producers.
These measu…
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Why Brick and Mortar Banking Still Matters
6 augustus 2026 · 4 min
America’s biggest banks are opening more local branches. Our Head of U.S. Large Cap and Mid Cap Banks Research Manan Gosalia looks at the merits of physical locations. Lees meer
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----- Transcript -----
Manan Gosalia: Welcome to Thoughts on the Market. I'm Manan Gosalia, Morgan Stanley's Head of US Large Cap and Mid Cap Banks Research.
Today: why the bank branch you pass on your commute may matter more than you think.
It's Thursday, August 6th at 10am in New York.
When was the last time you went to your bank? You probably do most of your daily banking online and maybe go to the local branch for occasional transactions, like getting a certified check or talking to a financial advisor.
So, you might think that bank branches are fading into the background. But America's biggest banks are actually accelerating their investments in physical locations.
That shift could reshape the competition for your deposits. In our research, we looked at where 12 large U.S. banks are expanding their footprints, and we identified 57 target markets. 34 of those markets are being pursued by multiple banks, and nine of those markets are being pursued by five or more banks.
Since mid 2025, about 80 percent of these banks' new branches have opened in those markets. Most of the expansion is happening in the Southeast and Texas, with additional activity in the Midwest and several major metropolitan areas. 95 percent of the target markets have either above median projected population growth or they have ranked in the top 10 percent for deposit growth.
That helps explain why Nashville and Atlanta are each targeted by seven of the banks, while Miami, Dallas, and Denver are targeted by six. These are places where households and businesses are growing and where banks see an opportunity to build relationships that could last for decades.
The central question is whether physical branches still attract deposits. The evidence suggests that they do. From 2022 to 2…
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How Long Can the Fed Hold On?
5 augustus 2026 · 4 min
From short-term interest rates to long-term bond yields, the Fed's credibility is being tested. Global Head of Fixed Income Research Andrew Sheets discussed inflation, Federal Reserve Chair Kevin Warsh's outlook, and the options ahead. Lees meer
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----- Transcript -----
Andrew Sheets: Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Today: Can the Fed hold the line?
It's Wednesday, August 5th at 2pm in London.
The Federal Reserve has a difficult job.
The U.S. economy is a complex and varied ecosystem that covers everything from brain surgery to your burger order. The Fed is asked to keep prices stable and people employed using, for the most part, just one simple tool. A short-term interest rate, and without any control over what government policy or global events might bring.
Currently, the Fed probably feels pretty good about its success with one half of this – in the job market, given that the unemployment rate is near historical lows. But it probably feels less successful about price stability. Over the last five years, overall prices in the U.S. economy have risen over 20 percent based on the Fed's preferred inflation measure. That's roughly double the increase that a goal of 2 percent annual inflation would otherwise bring.
Into this complexity steps a new Fed chair, Kevin Warsh.
He has emphasized two changes for his tenure. First, that inflation is too high and needs to come down. And second, that the Fed has historically communicated too much with the market, which Chair Warshkeep thinks has helped contribute to investors potentially taking too much risk while also restricting the Fed's options to act.
What markets are now processing is a potential tension between these two goals.
After all, high inflation is an immediate issue. In a world where the Fed is hoping to keep price increases at about 2 percent per year, their preferred measure, PCE inflation, is r…
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When a Data Center Comes to Town
4 augustus 2026 · 14 min
Head of US Public Policy Strategy Ariana Salvatore and US Thematic Strategist Michelle Weaver, alongside Senior Economist and Strategist in Morgan Stanley’s Private Wealth Management Sarah Wolfe, examine the economics of the AI datacentre boom, the pushback and the policy implications. Lees meer
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Head of Public Policy Research at Morgan Stanley.
Michelle Weaver: I'm Michelle Weaver, U.S. Thematic and Equity Strategist.
Sarah Wolfe: And I'm Sarah Wolfe, Senior Economist and Strategist with Morgan Stanley Wealth Management.
Ariana Salvatore: Today: the politics, economics, and market implications of America's AI data center build-out.
It's Tuesday, August 4th at 10am in New York.
AI infrastructure spending is becoming a major force in the U.S. investment cycle. But as you've heard on this podcast in recent weeks, local resistance to data centers is growing, and projects worth hundreds of billions of dollars are being canceled or delayed.
More than 300 local moratoria have passed since 2023, and restrictions now touch 40 states. Now, most are temporary pauses, not outright bans, but the community opposition is tangible.
For investors, the key question is how these local pressures shape the broader build-out. So, I wanted to talk to you both because, Sarah, you've looked at this on the local level, and Michelle, you've been leading some of our thematic work on this topic.
So, Sarah, maybe we'll start with what happens when a data center comes to town. How does a large project ripple through a local economy, especially when so much of the expensive hardware is imported?
Sarah Wolfe: I think we need to look at the data center build-out from two lenses. First, at the national level, and then what's really happening at the local level, county by county.
So, at the national level, the headline investment can actually overstate the contr…
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Quality Matters Again
3 augustus 2026 · 6 min
Our CIO and Chief U.S. Equity Strategist Mike Wilson explains why investors should favor quality as the market moves from early-cycle momentum to more disciplined, mid-cycle leadership. Lees meer
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----- Transcript -----
Mike Wilson: Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today on the podcast I’ll be discussing the ongoing transition in the economic recovery from early to mid-cycle.
It's Monday, August 3rd at 11:30 a.m. in New York. So, let’s get after it.
Following on from my podcasts the past few weeks, I want to reiterate our key call that the economy and the market are moving from early to mid-cycle. That may sound like strategist jargon, but it has very real implications for leadership, positioning, and how one should think about the next phase of this bull market.
For much of the past year, the market was rewarding early-cycle characteristics and behavior. Lower-quality, higher beta stocks, and the most explosive earnings revision stories led the way. That made sense. We were coming out of a rolling recession, operating leverage was improving rapidly, and earnings revisions were accelerating off of depressed levels. But as the business cycle matures, the market typically becomes more discerning. It starts to ask a harder question: not just who can grow, but who can sustain that growth with stable earnings, strong margins, and free cash flow generation.
In other words, quality starts to matter again.
That’s exactly where we are now. The rotation towards quality has begun, and I don’t view that as a bearish development for the broader market even if it’s bad for some of the former leaders. The S&P 500 is a very high-quality, large cap index. So, while the market may continue to consolidate in the near term, the quality rotation should ultimately support index resilience and help the S&P 500 work its way toward our 8000 year-end target.
The big market event …
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The Structural Forces Moving Capital
31 juli 2026 · 9 min
Our Strategist Michelle Weaver talks to Michael Zezas and Jessica Alsford, Co-Directors of the Morgan Stanley Institute, about how AI, energy resilience and industrial policy are changing investment decisions. Lees meer
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----- Transcript -----
Michelle Weaver: Welcome to Thoughts on the Market. I'm Michelle Weaver, Morgan Stanley's U.S. Thematic and Equity Strategist.
Michael Zezas: I'm Michael Zezas, co-director of the Morgan Stanley Institute and Deputy Global Head of Morgan Stanley Research.
Jessica Alsford: And I'm Jessica Alsford, Morgan Stanley's Chief Sustainability Officer, and also co-director of the Morgan Stanley Institute.
Michelle Weaver: Today: how AI, energy, geopolitics, and industrial investment are competing for scarce resources – and what that competition could mean for markets.
It's Friday, July 31st at 10am in New York.
Jessica Alsford: And 3 pm in London.
Michelle Weaver: Mike and Jess, as co-directors, you speak with people across the firm to identify the biggest questions facing companies and investors, especially the important ones that may not have clear answers yet. And to understand how those questions are shaping client conversations.
Mike, what's one of the questions that you think investors are wrestling with the most right now?
Michael Zezas: So, one of the biggest questions is how several major investment cycles can happen at the same time. AI, energy infrastructure, manufacturing, and defense may all be competing for the same power, the same skilled labor, equipment, and capital.
So, investors need to look beyond each theme in isolation and ask where constraints could delay projects, raise costs, or redirect spending, and which companies are best positioned to manage all of that.
Michelle Weaver: Since the institute began, you've examined a number of topics, including AI, energy resilience, and geopolitical fragmentation, just to name a few. Jess, which topic has been the most compelling to…
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Blind Spots in the AI Infrastructure Selloff
30 juli 2026 · 4 min
Our Global Head of Thematic and Sustainability Research Stephen Byrd explains why the recent AI infrastructure selloff may reflect technical pressures, not weakening fundamentals. Lees meer
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----- Transcript -----
Stephen Byrd: Welcome to Thoughts on the Market. I’m Stephen Byrd, Morgan Stanley’s Global Head of Thematic and Sustainability Research.
Today: Are investors misreading the AI infrastructure selloff?
It’s Thursday, July 30th, at 10am in New York.
The recent selloff in AI infrastructure stocks has raised a familiar question: Is the buildout running ahead of real demand? The market is pulling back and we think that reflects profit-taking, crowded positioning, and forced selling by investors. This is not about weaker fundamentals. But the selloff has brought to light three key concerns, which we think the market is overplaying.
The first concern is how much enterprises are willing to pay for AI. The median enterprise employee currently generates less than $11 a month in token spending. That’s the fee paid when an AI model processes a request and generates a response.
We think there is room for that to increase. From the employer’s perspective the economics are compelling. Across workplace applications, the cost to execute the economic task would be $2-$5. And that could save an enterprise $55. That to us suggests companies are likely to spend more, not less, on AI over time.
The second debate centers on efficient models, including competitive models developed in China. And here, policy responses both from the U.S. and China can have an impact as well. Some investors worry that better efficiency means less computing demand. But we see the opposite risk. This is a classic example of Jevons paradox: When something becomes cheaper or more efficient to use, people use more of it. In AI, lower costs can attract more users, encourage more frequent use, and make complicated applications more economical.
The scale is striking. I…
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The Oil Market’s Billion-Barrel Problem
29 juli 2026 · 13 min
How much runway does the world’s energy market still have? Our Head of Commodity Research Martijn Rats joins our Global Head of Fixed Income Research Andrew Sheets to explain what’s causing pressure beyond renewed tensions in the Middle East. Lees meer
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----- Transcript -----
Andrew Sheets: Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Martijn Rats: And I'm Martijn Rats, Head of Commodity Research at Morgan Stanley.
Andrew Sheets: Today – talking about the recent volatility and the direction ahead for oil.
It's Wednesday, July 29th at 2pm in London.
Martijn, it's great to talk to you again. We haven't talked for a little while on this program. But oil is once again back in the headlines and it's moving around.
So maybe to just jump right into things, as you look at the lay of the land in global energy markets at the moment, what's been happening? What are you telling clients?
Martijn Rats: Okay. Well, we've had a large amount of volatility, over the last couple of weeks. If you roll the clock back, sort of, to the beginning of June. In the beginning of June, it started to become clear that already some more oil was leaking out of the Strait of Hormuz than perhaps, many of us anticipated at the time.
But that data has been confirmed since then. And then, of course, in the middle of June, we got the memorandum of understanding. And after that, roughly 100-150 million barrels a day or so that was behind the Strait of Hormuz got cleared. And that…
Andrew Sheets: These were tankers that were stuck there during the conflict, all came out.
Martijn Rats: Absolutely. Laden tankers that were there; had just basically turned into floating storage for a good couple of months. They all cleared out, and that actually created a bit of a glut, in the sense that all of a sudden, the refiners of this world had a lot of crude to absorb. And we saw many indications of physical loos…
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Fed in July: A Weaker Case for Hiking
28 juli 2026 · 11 min
Our Global Head of Macro Strategy Matthew Hornbach and Chief U.S. Economist Michael Gapen unpack what is likely to influence this week’s interest rate decision by the Fed. Lees meer
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----- Transcript -----
Matthew Hornbach: Welcome to Thoughts on the Market. I'm Matthew Hornbach, Global Head of Macro Strategy.
Michael Gapen: And I'm Michael Gapen, Morgan Stanley's Chief U.S. Economist.
Matthew Hornbach: Today, will the Fed hold or hike? It's the question in the market right now.
It's Tuesday, July 28th at 9:30am in New York.
Will the Fed display patience, or has it run out of patience? That's the question hanging over the July FOMC meeting currently underway.
We believe the former. We expect the Fed to keep the target range for the federal funds rate unchanged at 3.5 to 3.75 percent. The statement will probably also remain unchanged, reiterating the ample reserve policy, economic activity expanding at a solid pace despite elevated uncertainty.
So, Mike, what's your assessment of the situation beyond that?
Michael Gapen: Our assessment of the July FOMC meeting is actually the case for hikes is not as persuasive now as it was in June. And I think when we say that and when we come to the decision the Fed will stay on hold this week, we're basing it mainly on the data that has come in since the June FOMC meeting. And two important pieces on that front are employment growth moderated.
So, in the June meeting, the three-month average payroll gain was running at about 188,000 per month. And I think it gave the sense that the labor market was really accelerating and there was downside risk to the unemployment rate. The subsequent employment data changed that view. Now it looks like there is much less of an acceleration in hiring and momentum has slowed. So, the labor market doesn't look quite as robust.
Second, there was a lot of information, we think, a lot of signal about disinflation. So yes, recent volatility in the Middle East …
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A More Selective Stock Market
27 juli 2026 · 5 min
Our CIO and Chief U.S. Equity Strategist Mike Wilson explains why he thinks the bull market has entered a new phase, with more focus on quality. Lees meer
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----- Transcript -----
Mike Wilson: Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today on the podcast I’ll be discussing the transition from early- to mid-cycle and what that means for your portfolio.
It's Monday, July 27th at 11:30 am in New York.
So, let’s get after it.
Our broadening call for the market has been about moving beyond the narrow leadership of the mega-cap winners and into more economically sensitive areas. That made sense in the context of our rolling recovery thesis, a period when revenue growth returns to lean cost structures, and operating leverage emerges across many sectors of the economy.
But now, I think that early-cycle phase of the rolling recovery is ending, and the market is starting to rotate toward quality. That’s not bearish, but it is different and can affect portfolios at the stock level.
As the cycle matures, investors stop rewarding low quality beta and start focusing more on free cash flow, balance sheet strength, margins, and earnings stability. The market is not abandoning the recovery. It is becoming more selective about the best way to own it.
This setup reminds me of early-to-mid 2021. After the initial post-COVID rebound, leadership shifted away from lower-quality and more speculative areas and toward higher-quality companies. The S&P 500 kept rising, but the leadership changed.
I think we’re seeing something similar today. The S&P itself is already a quality-heavy benchmark, with high-quality cohorts representing roughly 42 percent of the index versus about 28 percent for low quality. That should help keep the index resilient, even as the market continues to digest this transition.
Could we still see near-term volatility? Absolutely.
If the war escalates further or th…
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An Odyssey Through Market History
24 juli 2026 · 4 min
Looking at clues from the past, our Global Head of Fixed Income Research Andrew Sheets examines how the recurring themes – from deregulation to volatility – are shaping markets and why every cycle still takes its own path. Lees meer
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----- Transcript -----
Andrew Sheets: Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Today, what can Odysseus teach us about investing?
It's Friday, July 24th at 2pm in London.
Like many of you, this week I saw The Odyssey. The enduring appeal of this story more than 2,700 years after it was composed is a reminder that some themes are universal. Pride, resourcefulness, determination, self-control, or the lack thereof, mattered to both an ancient Greek dinner party and resonate with anybody investing today.
But drawing lessons from the past is also tricky.
We do not have that much financial history, and markets contain too many variables for the same combination to align twice. Some judgment, art, and dare we say storytelling is always involved in deciding which historical periods best describe the present.
Those disclaimers aside, we've argued in our year ahead outlook that 1997 to 1998 and 2005 to 2006 are some of the most useful templates for the current backdrop.
That remains our view.
They suggest a cycle that has further to run, equities outperforming credit, and a preference to own volatility. Both of these periods were defined by a sharp rise in corporate activity. That is certainly what we're seeing today.
We forecast U.S. capital expenditure to rise 23 percent in 2026, and 26 percent in 2027. AI is the biggest driver of this spending but build-outs in energy infrastructure are also playing a role. And increased corporate CapEx is certainly a global story, especially in Asia.
Then there's M&A, which also rose significantly in these two past historical periods. As recently as early 2024, global M&A volumes were unusually depr…
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Data Centers’ Political Battle
23 juli 2026 · 5 min
Despite growing political resistance, investment in data centers isn't slowing. Ariana Salvatore explains why supply constraints may actually accelerate AI capital spending. Lees meer
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Head of Public Policy Research at Morgan Stanley.
Today, I'll be talking about why we still expect robust AI capital spending in spite of some rising political pushback.
It's Thursday, July 23rd at 10am in New York.
It should be no surprise to our listeners that data center pushback, a topic that we've been following for some time, has been growing louder. But in 2026, it's accelerated meaningfully. Data we track suggests that an estimated $156 billion of projects were canceled or delayed in 2025. This year alone, in just the first quarter, we've seen almost that same exact number.
The opposition is coming from several directions.
Communities are raising concerns about rising electricity bills, environmental pressures related to water use, and the local quality of life effects of large-scale construction. But it's also coming from lawmakers across the aisle. State legislatures with both Democratic and Republican lawmakers have been advancing this type of policy.
At the same time, we're forecasting a little less than a trillion dollars of AI CapEx this year alone, and we think it's an increasingly important component of the macroeconomic growth outlook.
So how do we square that circle?
First, and most importantly, we think this is primarily a supply-side risk rather than a demand-side one. We don't expect the backlash to materially reduce projections for compute demand. Instead, it could widen the gap between that demand and the industry's ability to bring new capacity online through things like permitting delays, grid interconnection constraints, and local opposition.
Despite that more difficult political and infrastructure environment, our intern…
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More Stocks Join the Bull Market
22 juli 2026 · 4 min
Our CIO and Chief U.S. Equity Strategist Mike Wilson explains why market leadership is rotating beyond semiconductors and where investors may find opportunities despite near-term volatility. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today on the podcast, I will explain why the recent volatility in markets makes sense.
It's Wednesday, July 22nd at 2 p.m. in New York.
So, let’s get after it.
The broadening trade is back and it’s gaining steam. We established this thesis last week. Importantly, there’s a key reason this broadening trade is likely to continue. One of the more crowded areas of the market—semiconductors—has lost its momentum.
As I’ve also noted before, this is not a call that the AI cycle is over. However, stocks do trade on the rate of change in growth, and expectations often reach a place where they can no longer surprise on the upside.
Earnings revisions tend to get too stretched, and capital starts looking for the next place where fundamentals are improving but positioning is still light. This is no different than what happened to other leadership groups earlier this year in areas like precious metals and energy stocks.
Remember, I first made the call for market broadening in our November outlook. My view is that the economy had moved into a new expansion after the rolling recession ended in April 2025. Markets were starting to catch on before the Iran conflict interrupted that trend. Investors piled back into the AI trade—especially semis—as oil prices jumped and Fed expectations shifted more hawkish.
Back in June, I noted that those earnings revisions were likely nearing their peak. Hyperscale stocks starting to lag was the first indication. Since semis ultimately depend on hyperscaler spending, that divergence usually doesn’t last. It doesn’t mean the buildout is ending. However, the spenders may be moving from…
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The Global Rate Debate
21 juli 2026 · 13 min
In the second part of our economic roundtable, Michael Gapen, Jens Eisenschmidt and Chetan Ahya join Seth Carpenter to discuss how central banks are balancing sticky inflation, resilient growth and regional policy trade-offs. Lees meer
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----- Transcript -----
Seth Carpenter: Welcome to Thoughts on the Market. I'm Seth Carpenter, Morgan Stanley's Global Chief Economist and Head of Macro Research.
And once again today, I am joined by Morgan Stanley's chief regional economists: Michael Gapen, the Chief U.S. Economist, Jens Eisenschmidt, our Chief Europe Economist, and on the other side of the world, Chetna Ahya, our Chief Asia Economist.
Yesterday, we talked about what's supporting growth around the world, especially AI spending in the U.S. and some government spending in Europe, and Asia's role in making all of this happen. Today, we're going to try to dig deeper and go into policy.
It's Tuesday, July 21st at 10 am in New York
Jens Eisenschmidt: And 4pm in Frankfurt.
Chetan Ahya: And 10pm in Hong Kong.
Seth Carpenter: Since the last time we did this in mid-April, I will say the debate around central banks has probably become more complicated. Global growth has held up, probably better than many people expected. And inflation, which picked up a lot, started to recede. But it has not gone away. And some of the forces helping to shape the economy, the AI spending, government spending, that possible upswing in manufacturing, that could keep demand strong, and it might keep pushing inflation higher.
So, the question today is, if growth remains resilient, how much room really do central banks have to navigate?
Mike, let me start with you because your call for the Fed here in the U.S. is out of consensus, or at least at odds with where the market is pricing things. We talked about the demand going from AI. You pointed out that imports are actually limiting how much domestic demand there is.
So, what is the underlying story for inflat…
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AI Spending: A New Engine for the Global Economy
21 juli 2026 · 13 min
AI investment is reshaping the global outlook. In part one of this economic roundtable, our panel explores where the momentum is strongest — and where investment still needs to catch up. Lees meer
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----- Transcript -----
Seth Carpenter: Welcome to Thoughts on the Market. I'm Seth Carpenter, Morgan Stanley's Global Chief Economist and Head of Macro Research.
Michael Gapen: And I'm Michael Gapen, Chief U.S. Economist.
Chetan Ahya: And I'm Chetan Ahya, Chief Asia Economist.
Jens Eisenschmidt: And I'm Jens Eisenschmidt, Chief Europe Economist.
Seth Carpenter: And today is going to be our third quarter economic roundtable taking a wide-angle view on the global economy and all the key forces shaping our outlook and the economy.
Seth Carpenter: It's Monday, July 20th at 10am in New York
Jens Eisenschmidt: And 4pm in Frankfurt.
Chetan Ahya: And 10pm in Hong Kong.
Seth Carpenter: Since our last roundtable in April, the global economy has continued to face all sorts of shocks, a mix of resilience and friction. Inflation pressures have not disappeared. Energy and geopolitical risks have come up, they've receded, they've come back, they've receded all over the place
But there is one underlying source of momentum that we have to talk about. And that is the AI-driven CapEx cycle.
Michael, let me turn to you because the U.S. is a real focal point of all of this. Tell me a little bit about where Morgan Stanley Research is thinking about hyperscaler CapEx. How big it is? And then for you, when you think about the U.S. economy, just how big of a driver is it for what we're looking for in the U.S.?
Michael Gapen: Yeah, we continue to revise higher our estimates for hyperscaler and AI-related CapEx in the U.S. economy. We were thinking a little over a trillion for 2027. Now we're more like 1.2 - 1.3 trillion, maybe as high as 1.4 trillion in 2028. So, the level of hyperscaler spending continues to keep rising.
The growth rate and its effect …
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Why Your Medical Bill Is So High
17 juli 2026 · 12 min
Our analysts Andrew Sheets and Mark Schmidt unpack why U.S. healthcare feels so expensive and the potential impacts of rising hospital costs. Lees meer
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----- Transcript -----
Andrew Sheets: Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Mark Schmidt: And I'm Mark Schmidt, Head of Municipal Strategy at Morgan Stanley.
Andrew Sheets: And today on the program, a discussion into one of the biggest mysteries in one of the biggest sectors of the economy. We're talking about healthcare costs.
It's Friday, July 17th at 2pm in London.
Mark Schmidt: At 9am in New York.
Andrew Sheets: So, we're talking today about healthcare, which represents roughly a fifth of the U.S. economy, the bulk of job creation over the last several years, and in my view, honestly, one of the biggest inflation paradoxes that we see in the market.
On the one hand, the high cost of healthcare is taken as a given, and it's something that many Americans still struggle with financially. But if you look at the official inflation data in the U.S., healthcare costs have been lower than normal, and that's been true now for a number of years.
So, what's going on? How do we tie this together? And Mark, you just wrote a report that tries to do exactly that. So, what did you hope to accomplish with this report?
Mark Schmidt: You're absolutely right. It's hard to underline enough just how large healthcare is to the U.S. economy overall. Americans spend nearly $6 trillion on healthcare. That's more than the GDP of the entire country of Germany. And if we think about prices, Americans pay more.
A knee replacement, for example, costs $25,000 in the United States. That same procedure costs just $6,000 in France. Common heart treatments that would cost $3,000 in Germany or $10,000 in Australia cost $34,000 in the U.S.
It also matters for everyone's local community. Healthcare jobs have been growing twice as fast as…
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A Test for Capital Markets: Funding AI
16 juli 2026 · 12 min
Credit markets are stepping in to fund the surging demand for AI. Our experts Lindsay Tyler and Anish Shah explore the opportunities and risks behind this record financing wave. Lees meer
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----- Transcript -----
Lindsay Tyler: Welcome to Thoughts on the Market. I'm Lindsay Tyler, TMT Credit Research Analyst at Morgan Stanley.
Anish Shah: And I'm Anish Shah, Global Head of Debt Capital Markets at Morgan Stanley.
Lindsay Tyler: Today, how issuers and investors are approaching the rapidly evolving world of AI financing.
It's Thursday, July 16th at 10am in New York.
As AI demand accelerates, credit markets are being asked to finance infrastructure on a scale that used to be associated with utilities, telecom, or energy. That raises a central question for issuers and investors: How much debt can the AI ecosystem absorb? And at what price?
Anish, can you walk our listeners through the key products in your purview?
Anish Shah: Certainly, in my nearly twenty years at Morgan Stanley, this is probably the most incredible time period I've ever seen in the credit markets. I've had the privilege of working across a number of different roles in capital markets and lending. And a couple of years ago, we integrated the debt underwriting business across both investment-grade and leverage finance franchises in recognition of how interconnected the whole credit ecosystem has become.
In addition to our core activities helping clients raise capital for their strategic priorities, two of the big focus areas that we've had have been finding ways to harness the power of the private credit universe and also delivering best-in-class capabilities in funding this incredible growth in AI spend.
Lindsay Tyler: AI financing has certainly been a theme we've also been focused on in research. Our equity research colleagues project that a handful of key players could add more than 30 gigawatts of capacity over a two-year timeframe, driving around [$]2 trillion…
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AI as a Sovereign Power
15 juli 2026 · 5 min
AI has become a strategic policy priority as governments race to secure their technological future. Our Head of U.S. Public Policy Research Ariana Salvatore explores what’s driving the shift and the implications for markets. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I’m Ariana Salvatore, Head of U.S. Public Policy Research at Morgan Stanley.
Today: Why sovereign AI is becoming a policy priority around the world.
It’s Wednesday, July 15th, at 10am in New York.
The AI controls debate used to be focused on chips. Cutting edge semiconductors are essential to train large AI models, after all. But over the past year, the debate has moved well beyond that narrow focus. The policy conversation has broadened beyond things like which advanced semis can be sold to China.
The bigger question now is who controls the full AI stack — chips, cloud infrastructure, frontier models, data centers, cybersecurity standards, and the energy systems that support all of it.
That’s what we mean when we talk about sovereign AI. At the simplest level, it's a country’s ability to develop and deploy artificial intelligence using its own infrastructure, data, workforce, and technology ecosystem. But sovereign AI is also about reducing strategic dependence on foreign platforms and foreign-controlled supply chains.
That echoes a trend toward multipolarity that we’ve been writing about since back in 2018. Countries around the world are prioritizing national security over economic efficiencies. We see that theme applying to AI as well.
So, what does this all mean for markets?
First, sovereign AI turns AI infrastructure into a matter of national industrial policy. Data centers, power availability, and grid reliability are just a few examples of components that are becoming strategic assets. That means governments are likely to play a larger role in deciding several aspects of the AI buildout. Where it’s built? Who finances it? And whic…
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What’s Fueling Stocks After the AI Trade
14 juli 2026 · 5 min
Our CIO and Chief U.S. Equity Strategist Mike Wilson discusses where investors may find opportunity beyond the AI sector and risks that could slow market gains. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today on the podcast I’ll be discussing our broadening thesis and the near-term risks to monitor.
It's Tuesday, July 14th at 11:30 am in New York.
So, let’s get after it.
The broadening trade is now playing out. It’s showing up in stock prices, relative performance and earnings revisions. It’s also making investors question the sustainability of the most crowded areas of the market, and consider other near-term risks.
I first made the broadening call late last year based on my view that the economy had entered a new expansion after completing the rolling recession in April of 2025. In a new expansion, earnings growth tends to be much better than expected because revenue growth returns to companies that have already become more cost efficient.
That’s classic operating leverage. The market began to anticipate that dynamic late last year, but then the Iran conflict interrupted the move. Oil surged, rate-cut expectations disappeared, and investors crowded back into the most obvious AI capex beneficiaries led by semiconductors and memory, in particular.
Since mid May, that interruption has faded with oil prices falling sharply and the broadening trade has begun to work again. Importantly, the market is not abandoning AI. It is simply rotating within AI and beyond AI. And that distinction matters.
Semiconductors have had a historic run, supported by earnings revisions. But even great stories get exhausted in the short term. When earnings revisions breadth is pressing against historical highs and the trade becomes one of the most crowded areas of the market, the bar for upside gets very high. At that point, the issue is not whether the …
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Lower Prices, Bigger Market: The Next Phase of GLP-1 Drugs
13 juli 2026 · 12 min
Cheaper obesity medicines could unlock broader demand, while supply-chain bottlenecks and premium-drug innovation may also shape how the market evolves. Our analysts Terence Flynn and Thibault Boutherin break down the investor implications. Lees meer
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----- Transcript -----
Terence Flynn: Welcome to Thoughts on the Market. I'm Terence Flynn, Morgan Stanley's U.S. Pharma and Biotech Analyst.
Thibault Boutherin: And I'm Thibault Boutherin, Morgan Stanley's Europe Pharmaceuticals Analyst.
Terence Flynn: Today, how cheaper GLP-1 obesity medicines could reshape access, pricing, and supply chains; and what the first generic markets may signal for Europe and the U.S.
It's Monday, July 13th at 10am in New York.
Thibault Boutherin: And it's 3 pm in London.
Terence Flynn: Around one billion people live with obesity worldwide, including over a 100 million in the U.S. Right now, the introduction of the first lower cost generics of semaglutide, a GLP-1 medicine, in some international markets, could have consequences on affordability and demand.
Thibault, what are the first countries seeing the introduction of sema generics? What are the current dynamics, and why should global investors pay attention?
Thibault Boutherin: Sure. So, so far generics are being introduced this year in three countries: in India, Canada and Brazil. And if we look at India, this is the first market where the generics are being introduced. The patent for semaglutide expired in March 2026, and 13 companies have launched 26 generics across different formulations: autoinjectors, vials, and pills, which price is lower than the branded drug.
And because the India market was quite under-penetrated for GLP-1, we are seeing affordability driving volume expansion. In Canada, two generics have been launched so far. Four other generics are waiting for approval, and more are being filed. And finally, in Brazil, one generic was approved last month, and we are expecting these ge…
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A New Chapter for North American Trade
10 juli 2026 · 5 min
The USMCA review is underway, with implications beyond tariffs. Our Head of U.S. Public Policy Research Ariana Salvatore breaks down the key issues shaping the road ahead. Lees meer
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Head of U.S. Public Policy at Morgan Stanley Research.
Today, I'll be talking about the USMCA review – what happened on July 1st, what it means for North American trade, and how investors should be thinking about the road ahead.
It's Friday, July 10th at 10am in New York.
Last week, the six-year review deadline for the USMCA came and went. And as we'd anticipated, the U.S. declined to extend the agreement for another sixteen-year term. U.S. Trade Representative Greer stated that the U.S. did not agree to renew the USMCA in its current form, pointing to shortcomings and trade deficits with both Canada and Mexico, much of which echoed his testimony in front of Congress in December of last year.
So, what happens next?
This decision triggers an annual review process that could continue until the agreement's scheduled expiration in 2036. So, that means effectively the new deadline for negotiations is now July of 2027. And if we get to that point and see a similar outcome, this procedure repeats until the deal is terminated in 2036.
Now, importantly, the agreement itself remains fully in force during this period. The current tariff regime, rules of origin, investment protections, and dispute settlement mechanisms are all unaffected for now. That's actually in line with the expectation that we laid out earlier this year. In short, we anticipated an outcome in which negotiations stall and the deal moves to annual reviews. We thought that was becoming more likely than an ambitious expansion of the agreement in its current form.
That being said, there are some important implications of this outcome.
First, we think North American trade is being reshaped by a t…
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The AI Divide Between the U.S. and Japan
9 juli 2026 · 11 min
Robert Feldman and Michael Gapen discuss how AI could reshape growth, labor markets and productivity in the U.S. and Japan. Lees meer
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----- Transcript -----
Robert Feldman: Welcome to Thoughts on the Market. I'm Robert Feldman, Senior Advisor at Morgan Stanley MUFG Securities in Tokyo.
Michael Gapen: And I'm Michael Gapen, Morgan Stanley's Chief U.S. Economist.
Robert Feldman: Today, we'll discuss why the U.S. and Japanese economies may react differently to the AI productivity test.
It's Thursday, July 9th at 8 pm in Tokyo.
Michael Gapen: And 9 am in New York.
Robert Feldman: AI is the biggest theme around the world right now, but AI will play out differently in different economies. Take the cases of the U.S. and Japan. In the U.S., it's already a catalyst in investment, imports, productivity, and the labor market outlook.
But here in Japan, it's seen as a savior for an economy with an intense labor shortage, low unemployment, and very little room to raise labor force participation.
Mike, in the U.S., AI's contribution to real GDP growth will rise from about 0.05 percentage points in 2024 to an estimated 0.43 percentage points in 2027.
What does that mean for markets?
Michael Gapen: Well, Robby, I think it, it means a number of things, but, you know, I'm an economist, so the answer is always, "It depends." I think the real crux of the issue over time in the U.S., and therefore what it means for financial markets, is ultimately whether AI is labor replacing – and pushes the unemployment rate higher. Or it acts like a more traditional general-purpose technology that's labor augmenting.
So, if, that's the case, meaning it looks similar to the internet and digital era, then it would mean faster output growth, stronger productivity growth, but still an economy that's running at or near full employment. That would be very beneficial in our estimation for risk assets, equity markets, credit markets, and it would probably mean tha…
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3 Things That Could Break the Summer Rally
8 juli 2026 · 4 min
Our Global Head of Fixed Income Research Andrew Sheets outlines what could potentially go wrong and disrupt markets’ optimism this summer. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Today, discussing three things that could disrupt a quiet summer.
It’s Wednesday, July 8th at noon in New York.
As markets turn the page toward the second half of the year, there are lots of reasons for optimism. Global growth remains solid. Earnings growth is strong, and broadening across more companies. Capital markets remain open and deal activity is robust. We continue to think that the best analogy for current conditions is something like 1997 through 1998 or 2005 through 2006 – periods where corporate aggression was increasing, and had further to go, leading to equities outperforming credit.
Even more immediately, July also happens to be one of the best months of the year for markets. And while one should never base their entire investment strategy on how far the earth has travelled around the sun, this month has been the best month for the U.S. High Yield returns, by far, over the last 15 years. The last time the S&P 500 fell in the month of July was 2014.
So given all that, what could go wrong? Well, here are three things that are on our mind.
First, a key part of our most optimistic view is that U.S. inflation will be lower than the Federal Reserve expects in the second half of this year, leading them to leave interest rates unchanged, rather than raise rates as the market expects.
The risk is that this assumption is just wrong, perhaps soon. There is certainly an argument that, if the Fed is worried about inflation, it shouldn’t wait to act, and the market is currently placing roughly 1-in-3 chance that the Fed hikes rates on July 29th. If that happens – and again, our base case is it does not – it could drive volatility.
Second is earnin…
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AI’s Next Stress Test
8 juli 2026 · 12 min
The biggest AI stocks have had a remarkable run – but questions still remain. Our Head of Americas Specialty Sales, Thomas Wigg, speaks with Global Head of Thematic and Sustainability Research Stephen Byrd and Global Head of Public Policy Research Ariana Salvatore about the competition and durability of the investment cycle. Lees meer
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----- Transcript -----
Thomas Wigg: Welcome to Thoughts on the Market. I'm Tom Wigg, Morgan Stanley's Head of Americas Specialty Sales.
Stephen Byrd: I'm Stephen Byrd, Morgan Stanley's Global Head of Thematic and Sustainability Research.
Ariana Salvatore: And I'm Ariana Salvatore, Morgan Stanley's Head of Public Policy Research.
Thomas Wigg: Today, the rally in AI CapEx beneficiaries has taken a breather in recent weeks on concerns of competition from open-source models, backlash to token-maxxing, and growing political opposition to data center builds.
It's Tuesday, July 7th at 10am in New York.
Let's start with you, Stephen. There's a lot of discussion recently around a backlash at token-maxxing. Essentially, enterprises trying to curtail their high spending on AI tokens from the frontier labs, and, in many cases, shifting to cheaper open-source China models.
Can you first offer some perspective here on the value of tokens for enterprises? I know you have a popular token factory model that walks through the economics of agents.
Stephen Byrd: Yeah, Tom, we do have this model that really walks through token economics, both from the adopter side as well as the hyperscaler side. So, let's do the adopter side.
So, there's a study out that shows a whole range of enterprise use cases of AI, and the average single use case that they identify would save a company about $55 or provide that much benefit. And while we don't know exactly how many tokens it will require, we can make some educated guesses as to a typical token usage to achieve that $55 outcome.
And we know that a typical American model, tho…
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Next Leg of the Bull Market?
6 juli 2026 · 5 min
A changing macro backdrop is creating new opportunities across the equity market. Our CIO and Chief U.S. Equity Strategist Mike Wilson looks at what's driving the shift and where it may lead next. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today on the podcast I’ll discuss why I think the broadening out in equity markets can continue.
It's Monday, July 6th at 11:30 am in New York.
So, let’s get after it.
Let’s talk about a market dynamic that’s becoming harder to ignore. The broadening trade is back, and it’s gaining momentum partly because one of the most crowded areas of the market – Semiconductors – is finally starting to lose some of its own.
To be clear, this doesn’t mean the AI cycle is over. However, trends don’t move in straight lines, and leadership can ebb and flow; especially if there are fundamental reasons supporting it. In fact, we’ve seen this happen several times already over the past couple of years with the hyperscalers and semiconductors ebbing and flowing. This is based on positioning, the rate of change on expectations for capex and the returns on that capex.
Meanwhile, our broadening call goes back to last November. Back then, we argued the economy had entered a new expansion after the rolling recession ended in the April of 2025. That view was based on a classic early-cycle setup where revenue growth returns to companies that had become cost efficient. That is the definition of operating leverage and that always leads to better than expected earnings growth – the core differentiation to our original outlook this year.
The market started to discount that broadening late last year and into early this year. Then, the Iran war interrupted it. Oil prices surged, and the bond market went from pricing Fed cuts to pricing hikes, and investors crowded back into the obvious AI capex winners – especially Semiconductors…
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America’s Frontier-Market Origin Story
3 juli 2026 · 7 min
As America nears its 250th birthday, our Global Head of Fixed Income Andrew Sheets looks back at the early republic as a volatile frontier market, and what its path from credit risks to durable institutions can teach investors today. Lees meer
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----- Transcript -----
Andrew Sheets: Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Today, markets are closed for the observance of 4th of July. But as America approaches its 250th anniversary, we take a look back to look forward at early America as a frontier market.
It's Friday, July 3rd at 9am in Seattle.
If you were a global investor at the end of the 18th century looking for a stable, low-risk home for your capital, it would have been entirely reasonable to avoid the newly minted United States of America. By the standards of modern finance, the young republic was not a developed market in waiting. It was a frontier economy: volatile, debt-burdened, institutionally fragile, resource-rich, politically combustible, and astonishingly unequal.
Its currency had collapsed. Its public finances were suspect. Its citizens resisted taxation, and its growth prospects were extraordinary. In 1810, 70 percent of the country was under the age of 25.
That is one of the revelations of Gordon Wood's Empire of Liberty, which focuses on the early days of the new country from 1789 to 1815.
Wood's America is not the marble republic of statues and myth. It is speculative, messy, and full of motion. The United States succeeded not by escaping the dysfunctions that we associate with emerging or frontier markets, but by turning them into sources of strength.
Start with capital. Early America needed it desperately. Roads, canals, land purchases, and government all required credit, and there was never enough of it. The country was rich in land and poor in liquidity, a classic emerging market mismatch.
What the young country couldn't borrow or inv…
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Investors’ Focus Shifts to Rates and AI
2 juli 2026 · 5 min
Following meetings across Europe and Asia, our Global Head of Cross-Asset Strategy Research, Serena Tang, discusses two of the main themes on investors' minds: uncertainty around U.S. monetary policy and increasing caution toward AI despite its long-term potential. Lees meer
Serena Tang: Welcome to Thoughts on the Market. I'm Serena Tang, Global Head of Cross-Asset Strategy Research at Morgan Stanley.
And today, I'm bringing you a debrief from my investor meetings across Europe and Asia, and the key debates around AI and the Fed.
It's Thursday, July 2nd at 10am in New York.
The last two weeks, I have been traveling in Europe and Asia to meet with investors to discuss Morgan Stanley's latest views. Two themes dominated nearly every room I walked into.
The first is the Federal Reserve and monetary policy path in the U.S. Many investors had interpreted Chair Kevin Warsh's June FOMC meeting, his first at the helm, as unambiguously hawkish. What market investors at my meetings pointed out is that [the] Fed's Summary of Economic Projections – commonly shortened to SEP, which details policymakers' forecasts for macro metrics like GDP growth, inflation, and the federal funds rate – added a hike in 2026 and pushed out rate cuts, implying more restrictive policy.
Now, Morgan Stanley's economists think that hikes implied by SEP at the June FOMC meeting should be interpreted with caution. The projections appeared conditioned on elevated near-term inflation and may not capture the disinflation from a straight reopening. We actually anticipate a lower path for core inflation given a combination of a reversal in travel-related inflation and tariff payback, which lead to our call that the Fed remains on hold through 2026.
The second recurring theme in meetings with investors across regions is, unsurprisingly, AI. While in every single meeting investors believe firmly in the secular story of ongoing AI CapEx cycle, there was some unease – especially since AI is now also becoming an in…
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What to Watch Ahead of the Midterms
1 juli 2026 · 7 min
With voters focused on prices and the economy, our Head of Public Policy Research Ariana Salvatore and U.S. Thematic Strategist Michelle Weaver discuss the consumer trends that could matter most heading into November’s elections. Lees meer
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Morgan Stanley's Head of Public Policy Research.
Michelle Weaver: And I'm Michelle Weaver, Morgan Stanley's U.S. Thematic Strategist.
Ariana Salvatore: Today, we'll be talking about the consumer and what recent data could imply for the midterm elections.
It's Wednesday, July 1st at 10am in New York.
Last week, Mike Zezas and I caught up on the consumer while he was down at our Consumer Captains Conference. This week, Michelle, I want to talk to you about what your data are saying and get into the implications of all of this for the midterm elections.
So, maybe we start with the AlphaWise data. What are our surveys picking up when it comes to how the consumer feels about the outlook in the aggregate?
Michelle Weaver: We run a monthly proprietary survey of around 2,000 U.S. consumers, and it's diversified by age, gender, and region, and we ask questions around sentiment, spending plans, and other special topics. Our survey recently showed a continued gradual recovery in consumer confidence in the U.S. economic outlook.
We're not off to the races by any means, but we did see the net outlook score improve to -10 percent, up from -14 percent a month ago and a low of -18 percent two months ago, when concerns around oil prices were at their peak.
Overall, more consumers feel negatively about the economy versus positively, hence that net score is negative. But we are seeing signs of improvement, so things are improving on a rate of change basis.
Ariana Salvatore: That makes sense given the MOU that was signed between Iran and the U.S. Now, looking forward, what does the survey tell us about spending …
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The Market Shift Investors May Be Missing
30 juni 2026 · 6 min
Our CIO and Chief U.S. Equity Strategist Mike Wilson explains that gains in the stock market are expanding to more sectors and why investors should position quickly. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today on the podcast I’ll be discussing the changing equity market leadership.
It's Tuesday, June 30th at 11:30am in New York.
So, let’s get after it.
Something is happening in plain sight but still isn’t fully appreciated by investors. The market’s leadership is changing. And as usual, by the time everyone agrees that it’s happening, the easier money will probably have already been made.
Coming into this year, the primary differentiation to our view was that the economic and earnings outlook were much stronger than the consensus believed. That view was built around a few simple, but powerful ideas: easy comparisons after a three year rolling recession, lean cost structures, pent-up demand, fiscal support from capex incentives and tax cuts, deregulation for the banks, and a monetary backdrop that was increasingly supportive through the liquidity channel.
Putting those together, the setup looked like a classic early cycle. Revenue growth returning on top of lean cost structures leads to strong operating leverage and well above trend earnings growth.
Fast forward to today, and that’s exactly what has happened. The median stock in the S&P 1500 is now growing earnings at a double-digit pace, the fastest since the post-COVID boom. Revenue growth has returned, with the median stock growing its top line by 7 percent. That is a rolling recovery showing up where many investors still aren’t looking.
For much of this year and particularly the past few months, most investors didn’t want to hear that story. The Iran conflict pushed oil sharply higher. Rate-cut expectations turned into hike expectations. Faced with these headwinds, invest…
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Comeback for Europe’s Bull Market?
29 juni 2026 · 9 min
Europe's equity rally has surprised many investors. Our Europe Head of Research Product Paul Walsh and Chief European Equity Strategist Marina Zavolock discuss potential outcomes of the broadening market. Lees meer
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----- Transcript -----
Paul Walsh: Welcome to Thoughts on the Market. I'm Paul Walsh, Morgan Stanley's Head of Research Products here in Europe.
Marina Zavolock: And I'm Marina Zavolock, Chief European Equity Strategist.
Paul Walsh: And today, we're looking at whether European equities have more room to broaden – as markets assess the implications of a potential U.S.-Iran deal and a reopening of the Strait of Hormuz.
It's Monday, June the 29th at 10am in London.
Marina, it's always great having you on. And for our listeners out there, I think they'd be interested to hear that if we look at Europe's performance year-to-date, it's now on a par to the S&P. So, both indices are up somewhere between 7 and 8 percent year-to-date. So, Europe is starting to stage something of a comeback from the conflict lows.
And so, what's driving this? And are we beginning to see inflows into Europe again?
Marina Zavolock: So, I'm going to give a two-part answer to this.
Firstly, Europe has a lot of the same exposure as the U.S., so that is part of the reason… I know that Europe has this kind of reputation for not having a lot of tech exposure; but we do have tech exposure…
Paul Walsh: We do.
Marina Zavolock: Not to the same degree as the U.S., but, let me just give you some numbers here.
So, we have a number of sectors heavily exposed to the AI CapEx boom. These are led primarily by the semis sector in Europe, tech hardware, cap goods, and metals and mining; specifically, copper has a link to AI as well. And those sectors, let's say roughly they make up at this point about 15 percent weight of our index. And if you look at that year-to-date performance that's on par with the U.S., almost 90 percent of it is made up from these sector…
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The Warsh Effect on Mortgages
26 juni 2026 · 6 min
Although markets may recalibrate to a different policy playbook under the new Fed chair Kevin Warsh, housing could remain in a holding pattern. Our co-heads of Securitized Products Research Jay Bacow and James Egan explain why. Lees meer
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----- Transcript -----
Jay Bacow: Welcome to Thoughts on the Market. I'm Jay Bacow, co-head of Securitized Products Research at Morgan Stanley.
James Egan: And I'm Jim Egan, the other co-head of Securitized Products Research at Morgan Stanley.
Jay Bacow: Today, the glow has maybe worn off the championship of the Knicks, so we can talk about the impact of Warsh on the mortgage and housing market.
It's Friday, June 26th at 10am in New York.
James Egan: If we have to stop talking about the Knicks, we can stop talking about the Knicks. But Jay, I think one of the things, if we take a little bit of a step back in mortgage markets, in housing markets, in fixed income markets more broadly – from the beginning of the year to now, we've gone from the market pricing in 2.5 cuts from the Fed by the end of 2026, to the market pricing in roughly 1.5 hikes. 100 basis point difference in market expectations over the course of the past five and a half months.
Now, that's happened at different times, with different levels of velocity and severity. But one of the key talking points we have now is – we have a new Fed chair. We had the first FOMC meeting and his press conference after that last Wednesday.
What do you think that means for mortgage markets, for volatility? How are you thinking about this?
Jay Bacow: look, Jim, it's a great question, and we've got asked that by a number of different investors. Chair Warsh has been pretty clear that he thinks people should do more of what they're good at and less of what they're not good at.
And so, he's felt like the Fed should keep their communication on future guidance relatively short. And so, with less forward guidance from the Fed, the market has more uncerta…
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Consumer Confidence and the U.S. Midterms
25 juni 2026 · 10 min
Our U.S. Public Policy Strategist Ariana Salvatore joins our Deputy Global Head of Research Michael Zezas to consider the consumer outlook and how it may impact the November midterm elections. Lees meer
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Morgan Stanley's U.S. Public Policy Strategist.
Michael Zezas: And I'm Mike Zezas, Deputy Global Head of Research.
Ariana Salvatore: Today, we'll be discussing the consumer outlook, policy catalysts, and what it could mean for the 2026 midterm elections.
It's Thursday, June 25th at 9am in New York.
Mike, you're on the road, obviously not in New York City this week. Why don't you tell us a little bit about the conference that you're at, and then we can get into some of the topics that have come up in your conversations.
Michael Zezas: Yeah. I'm down in South Carolina at Morgan Stanley's Captains of the Consumer Industry Conference, where we put together investors and leadership of key consumer companies in the U.S. to learn about each other in a more informal way, brainstorm… And it's been really interesting.
We've had a lot of meetings with leadership from different prominent consumer companies throughout the U.S. And it's been really fascinating to hear how the consumer's been quite resilient. But in general, one pattern that sticks out is rising concern about lower-income consumers' behavior starting to lag in meaningful way higher-income consumers' behavior.
You're starting to see substitution and sort of more selectivity amongst lower-income households, a pattern that began a bit last year as a lot of these companies would report with higher tariffs. That seems to have continued with higher gas prices driven by the conflict in the Middle East.
So, there's a lot of discussion and concern about how durable it is. And in particular, if there are some policy choices here that might alleviate some of that pressure and bring some f…
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What a Quieter Fed Could Mean for Markets
24 juni 2026 · 4 min
In his first meeting as Fed Chair, Kevin Warsh signaled restraint in providing guidance. Our Global Head of Fixed Income Research Andrew Sheets looks at possible impacts of the new approach. Lees meer
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----- Transcript -----
Andrew Sheets: Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Today, why the Fed could do less than expected and why that could still lead to more volatility.
It's Wednesday, June 24th at 2pm in London.
Last week saw the first meeting of the Federal Reserve under its new chair, Kevin Warsh. It didn't disappoint.
The Fed’s Summary of Economic Projections saw significantly higher inflation than the last iteration in March, and in turn, a much stronger case to raise interest rates, perhaps multiple times. The Fed's statement, which laid out its views around the economy and its reasons for action, was changed dramatically – and also significantly shortened.
We don't think the Fed will ultimately follow through on the interest rate rises that were flagged in this meeting and will choose instead to remain on hold this year. But we think this scenario of them staying on hold can still lead to more volatility.
I'll try to address each side of this apparent contradiction.
First, the Fed is clearly worried about inflation, which has been elevated for a considerable period of time. But working through the numbers, Morgan Stanley economists forecast lower inflation over the rest of this year than the Fed now expects. And so, while we think it would be entirely reasonable for the Fed to expect to raise interest rates based on the high inflation that they have penciled in, we think they could reach a different conclusion if our lower estimates are ultimately correct.
Supporting our case, at least in our view, is that energy prices have fallen significantly in recent weeks since some of these Fed forecasts were set, as markets have moved to believe not only …
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The Obstacles to Buying a First Home
23 juni 2026 · 13 min
First-time homebuyers may get short windows of relief, but our co-head of Securitized Products Research James Egan and Senior Economist and Strategist in Morgan Stanley's Private Wealth Management Sarah Wolfe say the bigger story is a housing market resetting around a higher bar to entry. Lees meer
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----- Transcript -----
James Egan: Welcome to Thoughts on the Market. I'm Jim Egan, Morgan Stanley's U.S. Housing Strategist and Co-Head of Securitized Products Strategy.
Sarah Wolfe: And I'm Sarah Wolfe, Senior Economist and Strategist within Morgan Stanley Wealth Management.
James Egan: And today, why first-time homebuyers are facing a tougher path to ownership.
It's Tuesday, June 23rd at 10am in New York.
Buying a first-time home has always been a big step, but for a growing number of first-time buyers today, the goal can really seem insurmountable.
Mortgage rates might be down from where they were in the second half of 2023, but they're significantly higher than they were for the several years before that. Monthly payments have roughly doubled for a median-priced home. And my colleague Jay Bacow and I have talked several times on this podcast about how many homeowners feel like they're locked into those lower rates.
And they're staying put because they just don't want to give up a two or three-handle mortgage rate for something that has a six in front of it. But Sarah, as we know, this is bigger than just first-time buyers. Now, they often start the housing transaction chain, and when they can't buy, current owners may not be able to sell and trade up.
That slows turnover across the market, and it also reduces activity tied to housing – from mortgages and renovations to moving and furniture. And it can keep would-be buyers renting for longer, which adds pressure to rental demand.
So, how do you see this situation? Is this just another affordability squeeze, or has the housing market reset to a higher barrier to entry?
Sarah W…
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Why Warsh May Let Markets Tough It Out
22 juni 2026 · 5 min
Our CIO and Chief U.S. Equity Strategist Mike Wilson reacts to Kevin Warsh’s first Fed meeting, explaining why the new chair’s credibility may require letting markets experience some short-term pain. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today on the podcast I’ll be discussing my views on the New Fed Chair and how to interpret his FOMC meeting last week.
It's Monday, June 22nd at 11:30 am in New York.
So, let’s get after it.
I want to spend today on what I think was one of the more important market events of the year so far. Kevin Warsh’s first Fed meeting as the Chair. Specifically, he is trying to fortify credibility at a very delicate moment. The economy is stronger than many expected. Inflation is still running above target. And markets have become accustomed to central banks telling them exactly what to think.
Back in February, when Warsh was nominated, I argued that this was the right choice if the goal was to lift market credibility. At that time, precious metals were rising parabolically. To me that was a bad signal that markets were questioning whether policy makers could really run the economy hot without creating a disorderly move in the dollar or a broader inflation problem.
Since Warsh’s nomination, the S&P 500-to-gold ratio is up close to 40 percent, and I view that as a powerful vote of confidence from the markets. It suggests investors are giving Warsh the benefit of the doubt – that he can shake up the Fed, reduce reliance on the balance sheet as a policy tool, and solidify discipline that gives the administration some breathing room.
But here’s the catch. Enhancing credibility is not always painless. In fact, credibility must be earned by doing something markets don’t immediately like. And last week had some of that flavor. Stocks weakened, the yield curve bear-flattened, the dollar strengthened, and preciou…
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Inside the AI Debt Surge
18 juni 2026 · 11 min
As AI investment keeps growing, our strategists Carolyn Campbell and Vishwas Patkar discuss the many ways tech infrastructure gets financed and the opportunities for investors. Lees meer
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----- Transcript -----
Carolyn Campbell: Welcome to Thoughts on the Market. I'm Carolyn Campbell, Morgan Stanley's Asset-Backed Securities Strategist.
Vishwas Patkar: And I'm Vishwas Patkar, Morgan Stanley's Head of U.S. Corporate Credit Strategy.
Carolyn Campbell: Today, how fixed income markets are helping fund the AI build-out.
It's Thursday, June 18th, at 10am in New York.
Let's get right into it, Vishwas. We've both come on this podcast before to talk about how credit markets are financing the AI build-out. And over the last ten months, I think it's fair to say that things are faster, broader, deeper than we perhaps expected initially.
This investment now spans investment-grade corporate bonds, high yield loans, and a range of securitized products. From your seat in corporate credit, why does AI infrastructure matter so much, to investors right now?
Vishwas Patkar: This is a big talking point in our client discussions. it's also telling that less than a year ago, we wrote about this topic for the first time, identifying a $1.5 trillion financing gap that credit markets could help bridge. At that time, data center debt was not something that investors were really focused on. Yet less than 12 months forward, this, I think, is the number one theme dominating both your and my market.
And why it's important, I would say, is across, three key vectors. First, just the scale. So, if you look at overall AI-related debt issuance so far this year, we're close to $250 billion. For the balance of the year, we expect that number to double, so about $500 billion of total AI debt financing for 2026.
Increasingly the second vector, I think, is around the complexity of deals. So initially, while AI financing was dominated by vanilla investment-grade corp…
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Can Policy Solve AI’s Chipflation?
17 juni 2026 · 4 min
AI’s appetite for memory has turned chips into an inflationary factor. Our U.S. Public Policy Strategist Ariana Salvatore looks at what policymakers could do to reduce that pressure. Lees meer
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Morgan Stanley's U.S. Public Policy Strategist.
Today, I'll be talking about chipflation and what policy tools can or can't be used to address the memory bottleneck.
It's Wednesday, June 17th, at 10am in New York.
Last week, you heard my colleague Shawn Kim talk about chipflation and the surging cost of memory. Today, I'll get into what policymakers can and can't do about it.
As listeners will know, memory chips are becoming an increasingly strategic resource because AI infrastructure depends on them. And when a resource becomes strategic, governments tend to get involved. The challenge is that policy can help at the margin but probably can't solve the problem quickly.
There are three reasons for that. First, many U.S. policy tools all take time. Direct subsidies, tax credits, procurement guarantees, and faster permitting are all things that can support new fabrication plants, packaging facilities, and testing capacity. But memory supply is not going to appear overnight. This new capacity has to be built, equipped, qualified, and ramped – and that process can take years.
Second, China may be able to add some supply in conventional memory markets, but not enough to close the broader gap created by AI demand. That's especially true for high bandwidth memory, the more strategic type of memory for frontier AI systems. Supply there still remains highly concentrated, technically complex, and difficult to scale.
Third, our base case is that U.S. policy remains more restrictive, not less. We don't expect a broad loosening of export controls given the strategic imperative of this technology. Instead, we think policymakers are likely to continue to p…
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Warsh’s Opening Act at the Fed
16 juni 2026 · 12 min
Our Global Head of Macro Strategy Matthew Hornbach and our Chief U.S. Economist Michael Gapen discuss the signals investors will be seeking from the new Fed Chair leading his first monetary policy meeting and possible implications for markets. Lees meer
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----- Transcript -----
Matthew Hornbach: Welcome to Thoughts on the Market. I'm Matthew Hornbach, Global Head of Macro Strategy.
Michael Gapen: And I'm Michael Gapen, Morgan Stanley's Chief U.S. Economist.
Matthew Hornbach: Today, markets are watching the Fed's next move. Are rate cuts delayed or could hikes possibly be back on the table?
It's Tuesday, June 16th at 8:30am in New York.
So, Mike, the FOMC meeting today and tomorrow is likely more about reading the signal rather than announcing a rate change. Markets will focus on inflation forecasts, the unemployment rate, and the growth outlook. But, of course, this will also be the first meeting after Powell ended his term as Fed chair in May. All eyes will be on Warsh.
So, what are your thoughts before the press conference?
Michael Gapen: A lot of thoughts, actually, before the press conference. I do think it's basically a foregone conclusion that the Fed will be changing its easing bias in favor of more neutral language. Seems clear the committee wants to do that, probably wanted to do that at the last meeting. And it does fit, I think, Warsh's preference for less communication, less guidance from the Fed. So, I do think that's largely a foregone conclusion, although obviously we need to see whether that happens and whether there are dissents.
I think, as you noted, the forecasts will be important, but I think what's really important from my perspective – more than the modal outlook or the baseline that participants have – is their assessment of the balance of risks around the dual mandate. And I say that because obviously a year ago, the Fed eased policy when it felt that there were downside risks to the labor market that o…
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The Bull Case After the Pullback in Stocks
15 juni 2026 · 5 min
Our CIO and Chief U.S. Equity Strategist Mike Wilson explains why the recent equity correction may be more reset than reversal and where investors may find the next opportunities. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I'm Mike Wilson, Morgan Stanley’s CIO and Chief U.S. Equity Strategist.
Today: Possible opportunities to look out for in the equity correction over the past few weeks.
It's Monday, June 15th at 1:30pm in New York.
So, let’s get after it.
Sometimes the market changes direction or leadership not because the story has broken. Instead, it just needs to digest how quickly the story has evolved.
Over the past few weeks, equities had their biggest correction since the important bottom in March. I don’t view this as the end of the bull market though. I view it as a pause after an unsustainable acceleration in two key factors driving stocks higher this year: earnings revisions and liquidity.
In my view, the market wasn’t questioning the earnings bull market as much as it is questioning the speed at which earnings have been revised higher. These revisions have been particularly strong in leading sectors like semiconductors, which also corrected the most.
When earnings revisions breadth gets north of 70 percent, it’s reasonable to ask whether the second derivative is about to slow. That doesn’t mean earnings estimates are going down. Instead, it means the rate of improvement is probably peaking, and in markets, it’s always about the second derivative in growth. Such decelerations create corrections, not crashes.
That distinction is important. Earnings revisions breadth may pause or roll over from extreme levels, but the next twelve-month earnings estimates are still likely to rise as we move through the year and roll forward toward 2027 numbers. That’s why I remain convicted in our year-end S&P 500 target of 8000, even if the next few weeks remain choppy. Markets can correct while the earning…
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India’s Next Market Phase
12 juni 2026 · 13 min
Chief Asia Economist Chetan Ahya joins Head of India Research and Chief India Equity Strategist Ridham Desai to break down India’s macro outlook, capital flows and sector opportunities. Lees meer
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----- Transcript -----
Chetan Ahya: Welcome to Thoughts on the Market. I'm Chetan Ahya, Morgan Stanley's Chief Asia Economist.
Ridham Desai: And I'm Ridham Desai, Morgan Stanley's Head of India Research and Chief India Equity Strategist.
Chetan Ahya: Today, the biggest takeaways from our India Investment Forum in Mumbai. From the shifting outlook for India's markets and flows to the sectors driving the next phase of corporate earnings and CapEx.
It's Friday, June 12th at 7PM in Hong Kong.
Ridham Desai: And 4:30PM in Mumbai.
Chetan Ahya: Ridham, the Morgan Stanley's India Investment Forum took place in Mumbai last week, and I was there with you. These events are a great opportunity to speak with investors who come across from the globe to attend. Now that we have had a few days to process the conversations, what stood out to you? What was the biggest shift in investor sentiment that you picked on?
Ridham Desai: So, Chetan, I think it's been the case of a continuing story about India. Domestic investors look that they are bullish, and foreign investors continue to stay rather cautious on the Indian markets. We could see that in the overall attendance. In contrast, I think domestic investors were looking for the next stock that they wanted to buy. They were seeking opportunities, and there was a lot of interest in meeting companies.
Before we get into markets, let me turn back to you from a macro side. India's growth story remains strong, but relative growth appears to be cooling. This is in contrast to markets like Japan, Taiwan, Korea, and the US. How should investors think about India's macro positioning in that context?
Chetan Ahya: So, Ridham, when I look at the macro data in India, they're all indicating a meaningful upside in th…
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Inflation Relief Ahead?
11 juni 2026 · 5 min
Our Global Head of Fixed Income Research Andrew Sheets explains our differentiated view of a potential benign outlook for inflation, despite the recent acceleration. Lees meer
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----- Transcript -----
Andrew Sheets: Welcome to Thoughts on the Market. I'm Andrew Sheets, Global Head of Fixed Income Research at Morgan Stanley.
Today, why is everything still so expensive?
It's Thursday, June 11th at 2pm in London.
The Federal Reserve has a so-called dual mandate, tasked with keeping the labor market healthy and prices stable. It is currently having much more success with the former than the latter.
Let's start with that good news.
Last Friday saw solid data from the U.S. jobs market, reducing some of the fears from earlier this year that artificial intelligence and other factors would lead companies to make do with fewer workers. The U.S. unemployment rate sits at just 4.3 percent, a historically low level. Measures like initial jobless claims indicate no large uptick in firings.
Yet the success within the U.S. labor market is mirrored by struggles with inflation. The Fed tries to keep inflation, the annual increase in a broad set of prices, to about 2 percent per year. Their preferred measure of these prices, so-called PCE inflation, well, it's been materially above this target over the last three months, six months, twelve months, and indeed, the last five years.
As for another key measure of inflation that was reported yesterday, CPI, overall prices increased more than 4 percent. While that was close to expectations, it still represents prices that are rising much faster than the Fed would prefer.
This leads to a dilemma. One diagnosis of what's going on is that elevated inflation is a sign that conditions are simply too loose and too accommodative at these levels of interest rates. Corporate capital expenditure and merger activity is surging, regulation is being eased, and the U.S. government is spending a lot more than it's t…
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Who Owns Travel Loyalty?
10 juni 2026 · 13 min
Morgan Stanley analysts Ravi Shanker and Jeff Adelson take a look at what the fight for affluent, loyal travelers could mean for banks and airlines. Lees meer
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----- Transcript -----
Ravi Shanker: Welcome to Thoughts on the Market. I'm Ravi Shanker, Morgan Stanley's North American Airlines analyst.
Jeff Adelson: And I'm Jeff Adelson, Morgan Stanley's U.S. Consumer Finance analyst.
Ravi Shanker: Today, who really owns your travel loyalty? The airline, the bank, the rewards platform, or you?
It's Wednesday, June 10th at 7am in New York.
Jeff Adelson: So, Ravi, you just came from your annual travel conference, and I'm about to head into the second day of Morgan Stanley's 17th Annual Financials Conference here in New York, where we're hosting roughly 135 corporates.
A lot of themes are coming up there: retail engagement, product innovation, regulatory change, AI digital assets, capital markets recovery, and so on. All of these connect back to a bigger question. Who owns the customer relationship?
Ravi Shanker: And that's exactly where travel co-branded cards come in. They sit at the crossroads of premium consumer spending, loyalty, and the competition for wallet share. They've become a more important revenue stream across travel, banking, and hospitality.
But it's not as simple as more travel means more co-brand growth. Most customers still want flexibility, cashback, and low fees. Premium travelers and loyal airline customers behave differently.
Let's start with the cardholder. Most consumers have a credit card, but travel co-branded cards are still a much smaller piece of the overall wallet. So, how big is the opportunity here, and how hard is it to get consumers to switch?
Jeff Adelson: So, what's actually interesting, Ravi, is that travel co-branded cards are still relatively under-penetrated. In our survey, about 90 percent of cardholders have a general purpose card, while only about 22 percent have an airline card, and 12 …
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Asia’s Race to Power AI
9 juni 2026 · 5 min
As AI demand surges, our Asia Energy Analyst Mayank Maheshwari discusses the new multi-trillion-dollar investment cycle to secure the power, fuels, grids and storage that keep modern life running. Lees meer
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----- Transcript -----
Welcome to Thoughts on the Market. I’m Mayank Maheshwari, Morgan Stanley’s Asia Energy analyst.
Today: how AI’s rapid growth is forcing Asia into a massive energy buildout across power grids, fuels, storage and dependable energy and power generation.
It’s Tuesday, June 9th at 8am in Singapore.
Every time you ask AI to draft a note, summarize a file, plan a trip or generate an image, the response feels instant and easy. But behind it sits a very physical system: data centers, electricity, cooling, fuel, metals, power lines, storage tanks and ships.
There is no AI without energy. And in Asia, the power and energy needs could get much bigger. And right now, we are at a critical inflection point where energy, AI, and security converge into [a] once-in-a-generation investment cycle.
We see a super cycle with $5 trillion plus in new investments in energy over next five years, almost double of what we have seen in the past decade. And this has global implications as Asia consumes almost half of the world's energy needs – but produces only about a third of it at home. Energy markets may be global, but energy insecurity is local. It shows up in electricity prices, fuel shortages, factory delays, food supply pressure and household budgets.
By 2030, Asia’s energy use could rise by about 38 exajoules. That increase is roughly equal to all the energy the Middle East consumes today. Power demand alone could reach about 19 trillion units a year when expressed in kilowatt-hours. That is around four trillion more units of electricity usage than in 2025, driven by data centers, industry, and onshoring of businesses.
AI is now part of that demand story. By 2030, data centers could use roughly one-sixth of all new power…
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The High Cost of AI Memory
8 juni 2026 · 5 min
The Head of our Europe and Asia Technology Team, Shawn Kim, explains how AI’s appetite for memory chips is boosting the cost of everything from data centers to smartphones, with consequences that may reach far beyond the tech industry. Lees meer
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----- Transcript -----
Shawn Kim: Welcome to Thoughts on the Market. I’m Shawn Kim, Head of Morgan Stanley’s Europe and Asia Technology Team.
Today, we’re talking about chipflation – when memory chips stop getting cheaper over time, and become more expensive and even harder to find.
It’s Monday, June 8th, at 3pm in London.
Memory chips are easy to ignore, until your laptop slows down, your phone costs more, or your cloud bill jumps.
Memory is the computer’s workspace. It holds whatever the machine needs at that moment, whether that is a web search, a video, a spreadsheet, or an AI model answering a question. DRAM is the fast memory inside servers, PCs and phones. NAND is what stores files in solid-state drives. And HBM, or high bandwidth memory, is the high-performance version sitting right next to the AI chip, helping them move huge amounts of data quickly.
That last one – HBM – is key because AI has become intensely memory hungry. Memory prices have risen more than six-fold over the last year, a sharp break from decades when the cost of DRAM generally kept falling.
The pressure is coming from AI infrastructure buildouts. We see servers accounting for 59 percent of DRAM demand by 2028, up from 37 percent in 2023. We also see enterprise solid-state drives reaching 65 percent of NAND demand, up from 18 percent. And simply put, data centers are taking a much bigger share of the memory pie.
AI memory use is climbing fast, and at every scale. A newer AI chip uses 7.2 times more HBM than earlier generations. A full system uses about 65 times more. Across an entire AI data center buildout, the jump gets even bigger. HBM has gone from roughly 10 terabytes in 2020 to about 18 petabytes in 202…
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What New Tariffs Mean for Investors
5 juni 2026 · 4 min
Trade policy is once again in the news with the announcement of new tariffs. Our Head of Public Policy Research Ariana Salvatore digs into why tariffs may not be a disruptive factor for markets this time. Lees meer
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----- Transcript -----
Ariana Salvatore: Welcome to Thoughts on the Market. I'm Ariana Salvatore, Head of Public Policy Research for Morgan Stanley.
Today, I'll be talking about how investors should be digesting the latest tariff headlines and what they could mean for the broader economic and market outlook.
It's Friday, June 5th at 10am in New York.
Tariffs are back in focus as the U.S. administration has proposed new levies following Section 301 investigations into more than 60 of our trading partners. At the same time, USMCA negotiations appear to have begun in earnest, with recent headlines focused on autos, including the possibility of raising regional content requirements for vehicles and auto parts.
Now, at first glance, these developments sound like a meaningful escalation in trade policy. But we think these headlines are best understood as a continuation of the existing tariff regime rather than a new and more disruptive phase.
Let's start with Section 301. Listeners may recall that the administration replaced the IEEPA tariffs with Section 122 following the Supreme Court's decision back in February. However, that was done under a temporary authority that expires in the end of July. It's been our view that as we approach that deadline, the administration would seek to replace the existing regime under a new authority.
The conclusion of the Section 301 investigations is really a step in that direction; or said differently, a continuation of existing policy. We see the administration preserving the current tariff regime come July, but without a larger inflation or growth shock.
The second issue is the USMCA. Raising regional content rules may be part of the negotiation now, and those changes could create sec…